Streaming media to your car: More choices, maybe more distractions?

Your next car radio will be the end of a distribution pipe for web-based infotainment as streaming music muscles in on AM/FM, CD, iPod, USB music keys, satellite radio, and HD Radio. More than a dozen automakers now offer streaming media controlled from the dashboard and every car with A2DP Bluetooth streaming or even a lowly line-in jack can play but not control it. But with 250 million vehicles in the US, it’s a huge market barely tapped and in need of more bandwidth and users willing to pay for it.

The biggest beneficiaries of car-as-data-pipe will likely be streaming services and aggregators such as Pandora, Mog, and Harman. One of the big challenges remains: Who’ll pipe in the data and pay for it? Users can bring it via their smartphones, and that’s mostly how it’s done but data caps can be problematic. A streaming music service uses an estimated 15MB-50MB per hour, so a 2GB data plan would allow 1.5-4.5 hours of streaming per day if you didn’t also hit YouTube or Vimeo. Sometimes the automaker has the clout to get an affordable unlimited data plan. Audi says it chose T-Mobile for its telematics data provider because Audi knows T-Mobile through its presence in Audi’s home market of Germany and also because T-Mobile said yes to an unlimited data plan for about $25 a month. Telematics services at $20-$30 a month with no data plan are already meeting price resistance. It’s believed that OnStar’s renewal rate is about 50%.

Streaming music in the car is on the minds of a third of motorists. Thilo Koslowski, auto group VP of the Gartner consultancy, says 31% of motorists surveyed in the US want streaming media in their cars — 10% definitely want and 21% likely want streaming. That’s closing fast on 10-year-old satellite radio (13% definitely want, 26% likely want) and five-year-old HD Radio (11% definitely want, 27% likely want). Not surprisingly, in-car infotainment is more on the minds of younger than older buyers: A Deloitte survey shows 59% of buyers 19-31 say car connectivity is the most important aspect of a car interior and 72% want to use smartphone apps on-board.

The Deloitte survey also contends the average Gen Y buyer is willing to spend $3,000 on hardware technology providing connectivity. Odds are they’ll need to spend just a tenth of that for in-car telematics with an embedded voice-and-data cellular phone, a good antenna and a WiFi hotspot thrown in. (The balance would fund 5-8 years of streaming music and data.) Assuming under-30 buyers want to spend less than they tell pollsters, satellite radio will be hardest hit if drivers redirect the $15 monthly cost of Sirius XM to help pay for a cellular data plan. HD Radio probably won’t be caught in the pricing crossfire because it’s finally moving from an upgrade (as much as $400) to a chipset integrated in the head unit and adding little or no cost to the car.

The highest profile streaming service is Pandora. 13 automakers currently offer Pandora on at least one model. It’s on every BMW and Mini. It’s also on some models of cars from Buick, Chevrolet, Ford, GMC, Honda, Hyundai, Lexus, Mercedes-Benz, Scion, and Toyota. It’s on head units from Alpine, JVC, Kenwood, Pioneer and Sony. Mog (pictured above) has a smaller footprint, including on BMW and Mini. The pending (Cadillac User Experience) system will offer streaming media.

Streaming gives you more music sources; satellite with about 75 channels gives you more coverage (everywhere except under bridges) and Sirius XM is likely to add more premium content (Howard Stern, pro sports) to set it apart.

There are other streaming services clamoring for the attention of automakers such as Tunein, Stitcher, and even National Public Radio. With so many possibilities beyond Pandora, automakers worry about a lengthy adaptation and qualification process for multiple sources and then bad PR and maybe liability if they allow a distracting app to be one of their apps. Some are creating a smartphone open API (BMW Apps, Ford AppLink, GM’s OnStar Open API) that puts the onus on the streaming software vendor to write to the car interface. Some steer the apps through the iPhone and Apple store, so the developer has to jump through two hoops: Apple and the automaker. Alternatively, Harman’s Aha serves as a third party that approves and rolls in apps; Harman than arranges deals with automakers and guarantees future apps will also be compatible.

While you can grab your smartphone to find, start, and stop streaming music and use Bluetooth A2DP (Advanced Audio Distribution Profile) or line-in jack to make the car a speaker system, it’s definitely more convenient and less distracting if you can control streaming music via the car’s dashboard and voice controls. The only thing less distracting is not playing music at all, and that — no matter what the government or insurance industry would like you do — is unlikely.

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